Correlation Between JJill and Perseus Mining

Can any of the company-specific risk be diversified away by investing in both JJill and Perseus Mining at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining JJill and Perseus Mining into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between JJill Inc and Perseus Mining Limited, you can compare the effects of market volatilities on JJill and Perseus Mining and check how they will diversify away market risk if combined in the same portfolio for a given time horizon. You can also utilize pair trading strategies of matching a long position in JJill with a short position of Perseus Mining. Check out your portfolio center. Please also check ongoing floating volatility patterns of JJill and Perseus Mining.

Diversification Opportunities for JJill and Perseus Mining

-0.44

Correlation Coefficient

JJill  Perseus Mining

Very good diversification

The 3 months correlation between JJill and Perseus is -0.44. Overlapping area represents the amount of risk that can be diversified away by holding JJill Inc and Perseus Mining Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Perseus Mining and JJill is a relative statistical measure of the degree to which these equity instruments tend to move together. The correlation coefficient measures the extent to which returns on JJill Inc are associated (or correlated) with Perseus Mining. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Perseus Mining has no effect on the direction of JJill i.e., JJill and Perseus Mining go up and down completely randomly.

Pair Corralation between JJill and Perseus Mining

Given the investment horizon of 90 days JJill Inc is expected to generate 0.83 times more return on investment than Perseus Mining. However, JJill Inc is 1.21 times less risky than Perseus Mining. It trades about 0.03 of its potential returns per unit of risk. Perseus Mining Limited is currently generating about -0.04 per unit of risk. If you would invest  2,488  in JJill Inc on September 21, 2024 and sell it today you would earn a total of  80.00  from holding JJill Inc or generate 3.22% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Very Weak
Accuracy	100.0%
Values	Daily Returns

JJill Inc  vs.  Perseus Mining Limited

JJill Inc

Risk-Adjusted Performance

2 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in JJill Inc are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. Despite quite persistent essential indicators, JJill is not utilizing all of its potentials. The recent stock price mess, may contribute to short-term losses for the institutional investors.

Perseus Mining

Risk-Adjusted Performance

0 of 100

Weak

Over the last 90 days Perseus Mining Limited has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest weak performance, the Stock's basic indicators remain stable and the current disturbance on Wall Street may also be a sign of long-run gains for the company stockholders.

Pair Trading with JJill and Perseus Mining

The main advantage of trading using opposite JJill and Perseus Mining positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if JJill position performs unexpectedly, Perseus Mining can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in Perseus Mining will offset losses from the drop in Perseus Mining's long position.

The idea behind JJill Inc and Perseus Mining Limited pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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Note that this page's information should be used as a complementary analysis to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try the Global Correlations module to find global opportunities by holding instruments from different markets.